Fed's Williams Projects One More Rate Hike Late This Year Following September Increase

New York Federal Reserve President John Williams announced that one additional interest rate hike will likely be appropriate late this year, with no urgency to hike in October following September's 25-basis-point increase. Williams projected U.S. GDP growth of 2.25%, an unemployment rate near 4%, and inflation finishing the year around 3.5% before reaching the 2% target by 2028. He highlighted inflation risks from AI investment demand and energy costs. Following the remarks, the 2-year Treasury yield declined 2.5 basis points to 4.90%, providing relief to broader equities.